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The recommendations of the Retrenchment Commit-
tee, however they may be viewed by this Government, have been
accepted by the Colonial Office as a basis upon which we are
to act.
In comparing those recommendations with the
present salaries of the offices to which they apply, it will
be seen that, in the majority of cases, the present salaries
are more than 25% in advance of the salaries deemed suffi-
cient by the Retrenchment Committee. This meets to a large ex-
tent paragraphs 3,4, and 7 of the letter from the Portuguese
Civil Servants. As regards paragraph 5 of that letter, exchange
compensation, it is clear, can be granted only to persons having
a domicile in a gold standard country. As regards the 8th.
paragraph Jardine Matheson & Co.say that though the initial
salaries of most have been subject to an increase (which is
the case also in respect of Portuguese Government Servants),
the maximum has not been increased, thus showing a different
system from the Government system which does not deal with
maximum of salaries. The reply of the Hong-Kong Bank shows in-
creases and is the reply most favourable to the case of the
Portuguese Civil Servants, though I have pointed out above
that there are reasons in the case of the Bank which do not
C
exist in the case of Government Servants.
Messrs.Dodwell, Carlill & Co.plainly make capa-
city the reason of increase; this is not the Government method.
The Wharf and Godown Company's reply does not give any help.
The